Government money to Ontario auto parts maker will ensure jobs

Canada’s second-largest auto parts maker, Linamar, has agreed to maintain a minimum of 6,870 jobs at its Ontario facilities in exchange for an investment of just over $101 million by the provincial and federal governments. Combined with the Guelph company’s own commitment, the total investment by Linamar will be over $500 million. Linamar s expanding its operations to focus on producing new fuel-efficient auto transmission and power train parts. It is expected to add about 1,200 new jobs over the next decade.

The federal Transport Minister, Lisa Raitt said the federal loan of $50.7 million will help ensure that Linamar’s $506.8 million investment stays in Canada, “a great place to build cars.” The federal funding is provided through the Automotive Innovation Fund which has to date “leveraged” up to $2.3 billion for R&D and innovation in Canada. Besides that support, Canada offers auto makers “a stable economy, a low corporate income tax rate, a highly skilled and productive workforce, well-developed infrastructure and access to markets,” Raitt said.

Linamar-government-grant-Automotive-Innovation-Fund-auto-parts-industry-Ontario-EDIWeekly

For her part, Linamar CEO Linda Hasenfratz said it was “wonderful” to see governments “stepping up and being competitive,” given that there are so many jurisdictions that are willing to offer “all kinds of incentives” to companies like hers. Linamar will use the government money to fund the purchase of new equipment as well as research and development of new products. Hasenfratz called the government money “absolutely key” to enabling that investment.

Ontario’s contribution of $50.25 million is from the province’s new Jobs and Prosperity Fund, according to the premier, Kathleen Wynne. She said that such business grants are contingent on the company meeting investment and job targets.

The auto parts industry in Canada was worth about $24 billion last year. Linamar has more than 18,000 employees around the world, several thousand of them in Guelph. It reported a profit of $248.8 million on revenue of $3.2 billion in 2014. Profits and revenues were up sharply from the previous year.

In other auto news today, Chrysler president Sergio Marchionne said that the company’s new crossover vehicle will be assembled at the Windsor, Ontario plant if it goes ahead. Chrysler will invest $2 billion to develop the minivan and retool the plant to build it.

Did you miss this?

Other Popular Stories

  • Canada's oil sands dispute with EU flares
  • Tesla's Powerwall revealed, energy storage for the home
  • Oil production should grow 33 per cent in Canada by 2030, despite lower oilsands spending
  • Pros and Cons of EDM: What is electrical discharge machining, and how does it work?
  • Lobby groups working hard to convince Obama on Keystone
  • Ontario economy set to grow based on exports, weaker dollar
  • More consultation, less domestic content for Ontario's green energy process
  • Volvo to Expand Production of XC40 SUV in Europe and China
  • Game over for Hydrogen fuel cells? Not really — but an explosion in Norway halts sales of hydrogen fuel cell cars locally
  • Lead-free plumbing requirements affect valve selection for water systems
  • Canada's oil industry facing labour shortage: survey
  • TransCanada's Keystone XL pipeline clears last hurdle in $10 billion project as Nebraska approves 3 to 2
  • Manufacturing output grew again in August
  • Union workers safer in construction trades: study
  • Montreal firm to build flight simulators for US Navy
  • Contractors, steel workers unions support Northern Gateway pipeline
  • Job losses in Alberta, gains in Ontario, leave employment flat in January
  • Ontario's food industry poised for growth
  • Terraton Initiative: "Carbon Negative": an innovative solution could remove 1 trillion tons of carbon dioxide from atmosphere
  • National Energy Board not doing enough to ensure pipeline safety: report
Scroll to Top